Wave‐driven water level variability (and runup at the shoreline) is a significant cause of coastal flooding induced by storms. Wave runup is challenging to predict, particularly along tropical coral reef‐fringed coastlines due to the steep bathymetric profiles and large bottom roughness generated by reef organisms, which can violate assumptions in conventional models applied to open sandy coastlines. To investigate the mechanisms of wave‐driven water level variability on a reef‐fringed coastline, we performed a set of laboratory flume experiments on an along‐shore uniform bathymetric profile with and without bottom roughness. Wave setup and waves at frequencies lower than the incident sea‐swell forcing (infragravity waves) were found to be the dominant components of runup. These infragravity waves were positively correlated with offshore wave groups, signifying they were generated in the surf zone by the oscillation of the breakpoint. On the reef flat and at the shoreline, the low‐frequency waves formed a standing wave pattern with energy concentrated at the natural frequencies of the reef flat, indicating resonant amplification. Roughness elements used in the flume to mimic large reef bottom roughness reduced low frequency motions on the reef flat and reduced wave run up by 30% on average, compared to the runs over a smooth bed. These results provide insight into sea‐swell and infragravity wave transformation and wave setup dynamics on steep‐sloped coastlines, and the effect that future losses of reef bottom roughness may have on coastal flooding along reef‐fringed coasts.